Ixonos - Company Announcement

Ixonos sharpens its strategy as design-oriented technology partner to fewer segments and simplifies its organisation

IXONOS PLC                     STOCK EXCHANGE RELEASE 22 October 2013 at 12:30

IXONOS SHARPENS ITS STRATEGY AS DESIGN-ORIENTED TECHNOLOGY PARTNER TO FEWER
SEGMENTS AND SIMPLIFIES ITS ORGANISATION 

Ixonos' Board of Directors and management have updated the company's strategy
for 2014-2015. 

During the past two years, Ixonos' operating environment has undergone major
changes. This is largely due to the largest single customer's change in
technology strategy, which significantly impacted the demand for Ixonos' mobile
software development services. While the company has been adjusting its
strategy and operations, and broadened its customer base into new markets, the
work is still on-going to establish a stable customer base for future success.
Ixonos has been operating with its limited resources in many segments and
geographies resulting in thin interaction with potential clients. The sharpened
strategy focuses Ixonos' resources into areas, where based on our capabilities
and assets, we have the best possibilities to succeed. 

The market segments in which Ixonos operates are undergoing major
transformation, driven by online connectivity, mobility and higher demands for
usability and user experience. Companies in these markets are re-inventing
their business models and key assets to leverage the new disruptive forces by
developing digital technology to their advantage. Increasingly, companies also
realize the need to establish strategic technology partnerships to turn the
market discontinuities into strategic business opportunities. One of the
industry changing disruptions is the so-called Industrial Internet, which
changes the way industrial companies operate with their end-customers. 

Ixonos' unique Dream-Design-Deliver approach combines world-class user
experience design with strong end-to-end technology implementation. Ixonos
strives to establish long-term partnerships with its key customers, addressing
their underlying business drivers and delivering unique and long-term business
value through new creative digital solutions. Ixonos excels in helping
customers embrace Internet, cloud and mobile technologies to increase
productivity and deliver unique user experiences. 

Ixonos' sharpened strategy is to position itself as a design-oriented
technology partner for client companies in selected target markets. In line
with its sharpened strategy, Ixonos concentrates in building a steady position
in these target market segments during 2014-15: 
- Industry: Providing embedded and creative digital solutions for the
Industrial Internet, helping companies to transform from proprietary
technologies into standard open source technologies enabling increased
productivity and value for their customers, as well as providing digital
innovation to them in their transformation to new digitally connected service
business. Ixonos partners with leading chipset manufacturers, providing
state-of the art platforms for our solutions. Ixonos' clientele in this segment
consists of companies such as Kone, Outotec, Cargotec, Grundfos and Metso. 
- Media: Helping TV broadcasters, studios, production companies and operators
to offer increasingly interactive and personalised viewing experiences, as well
as new business models, through innovations such as Ixonos TV Compass™ 2nd
screen solution. Ixonos' clientele in this segment consists of companies such
as Fox, ESPN, MBC Group, Warner Brothers and Turner Entertainment. 
- Retail & brands: Helping consumer-facing retail and service brands to embrace
Internet-based digital and mobile solutions for excelling in omni-channel
retailing, customer experience, productivity and service innovation. Ixonos'
clientele in this segment consists of companies such as Stockmann, Iittala and
Nokian Renkaat. 
- Enterprise IT and ISVs: Providing secure and robust cloud and managed hosting
services with Ixonos Elastic Cloud™ solution. Designed for demanding enterprise
use, combining the security of a private cloud with the scalability and
workflow automation of public clouds, Ixonos' virtual private cloud works as an
extension to Ixonos' and customers' own hosted data centres combining the
delivery of dedicated infrastructure along with virtual hosting environments.
Ixonos Elastic Cloud is also used as an operating platform for several
end-to-end solutions. Ixonos' clientele in this segment consists of companies
such as Fonecta, eZ Systems, Improlity, Efecte, Nokia and Propentus. 

Ixonos also continues to serve its customers in several other segments,
including Automotive and Transportation, Smartphone OEMs, Mobile Operators as
well as Finnish Public Sector. The target market segments will however drive
our sales focus, growth and investments. 

ORGANISING AS ONE IXONOS

As part of sharpening its strategy, Ixonos also aligns its organisation to
enable efficient sales as well as agile solution creation and asset
development.   The new organisation, which will become effective on 1 November
2013, will consist of: 
- Sales & Marketing function in charge of customer relationships, sales
pipeline, order intake and profitable revenue generation, with primary focus in
chosen focus market segments. The unit is headed by Teppo Kuisma, SVP, Sales. 
- Solution Creation function in charge of customer project management and
profitable delivery, as well as offering portfolio management and R&D. This new
organisational unit will also lead the transformation from a predominantly R&D
services outsourcing company towards being a higher value-add solutions
company. The unit is headed by Bo Lönnqvist, SVP, Solution Creation. 
- Design function in charge of the design capabilities that are the unique
differentiator in the Dream-Design-Deliver approach. The unit is headed by Sami
Paihonen, SVP, Design. 
- Efficient & centralised support functions.

This reorganization will greatly improve the internal efficiency, allowing for
common processes and tools to be utilised across the company, as well as
bringing similar competences and capabilities together into common
organisational units. The current Connected Devices and Online Solutions
business units will be merged into the new organisational units listed above. 

Along with organising operations and improving operational effectiveness, the
company is in the middle of significantly adjusting its cost structure in order
to secure its future competitiveness. These cost-saving measures, as
communicated on 16 September 2013, are needed to align the company's cost
structure with its turnover outlook and direction, and to lay basis for
profitable operations during 2014. 

IXONOS PLC
Esa Harju, President and CEO

For more information, please contact:
Esa Harju, President & CEO, tel. +358 40 844 3367, esa.harju@ixonos.com

Distribution:
NASDAQ OMX Helsinki
Main media

Attachments:

Ixonos_StockExchangeRelease_strategy_organisation_22102013.pdf